GBP/JPY plunges to 5-week lows as Yen continues to soar

Haresh Menghani FXStreet

Yen continues to soar across the board, with the GBP/JPY cross reversing all of its post-BOJ recovery to 133.26 and extended its bearish move for the fifth consecutive session.

The BOJ's decision to leave interest rates unchanged at -0.1% seems to have disappointed few market participants expecting the central bank to take rates further into negative territory. The disappointment seems to have forced investors to unwind bearish Yen bets and is exerting intense selling pressure around the GBP/JPY cross.

Meanwhile, a softer tone around the GBP/USD major provided little incentive for bulls and the cross tumbled to the lowest level since August 19.

Next in focus would be the Fed monetary policy decision, which would determine further demand for both the Japanese Yen and the British Pound, eventually providing fresh impetus for GBP/JPY traders.

Technical levels to watch

From current levels, 130.50-60 area seems to act as immediate support, which if broken would turn the cross vulnerable to break below 130.00 psychological mark support and head towards testing its next major support near 129.20 area.

On the flip side, recovery back above 131.00 handle, leading to a subsequent move above 131.30 resistance, might trigger a near-term short-covering bounce towards 132.00 round figure mark.

	TREND INDEX	OB/OS INDEX	VOLATILY INDEX
15M	Bullish	Neutral	Low
1H	Strongly Bearish	Neutral	High
4H	Slightly Bullish	Overbought	Shrinking
1D	Bearish	Neutral	Shrinking
1W	Bullish	Neutral	Low
Updated Sep 20, 12:15 GMT

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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